Trouble is, the point-scoring between Barclays and the Bank of England is tearing the City of London apart. Cheered on from the sidelines by David Cameron and George Osborne, the game of banker-bashing has reached a fatal stage, not just for the careers and reputations of the men concerned but also for London's reputation as a financial centre.

The relationship between Barclays – one of the UK's biggest clearing banks, playing a central role in the UK economy – and the Bank of England is in tatters.

Sir Mervyn King, Governor of the Bank, personally intervened on Monday night (along with Lord Turner, chairman of the Financial Services Authority) to insist Bob Diamond was removed as chief executive of Barclays. The intended resignation of the bank's chairman, Marcus Agius, was considered to be the departure of the wrong man. It was Diamond they wanted.

And they got him at 7am on Tuesday. In turn, Barclays posted "supplementary information" on its website yesterday afternoon ahead of Diamond's appearance later todayin front of the Treasury Select Committee.

In it, an emailed memo places Paul Tucker, the Bank's deputy governor and until today favourite to succeed Sir Mervyn, firmly at the scene of Libor manipulation.

Barclays maintains what it did to its Libor submissions did not affect the overall rate but did protect it from false, negative perceptions of its financial strength. It has issued Diamond's account of a conversation with Tucker in October 2008. This, at the time, was taken by some in Barclays, including Diamond's number two, Jerry del Missier, as tacit permission to lower rates.

Diamond himself claims he didn't infer that from Tucker, but the memo has been helpfully published anyway so MPs can see why del Missier might have concluded that.

We should remember that all this happened in the heat of the October 2008 crisis. We were living in times when large UK banks weren't going to open the next morning without a state bail-out. People, it could be argued, did what they had to do.

But Agius, Diamond and del Missier have all admitted that what they did has since proven to be mistaken in one way or another. Surely they weren't alone? Tucker expects to face MPs on July 17, when he will be able to give his account of the Diamond memo – unless this tale takes another one of its extraordinary twists by then.

Let's keep banking and politics separate

That George Osborne knew about Bob Diamond's resignation before Barclays' shareholders reveals how business has become front-line politics.

Osborne said yesterday that Diamond's resignation was "the right step for Barclays and for the country", as if Diamond were an errant Cabinet minister and Barclays a Whitehall department.

Such a statement is at odds with the Chancellor's insistence that Diamond's decision to quit was the banker's own, along with the Barclays board.

And Diamond himself said in his resignation statement: "The external pressure placed on Barclays has reached a level that risks damaging the franchise – I cannot let that happen."

Banks have received state aid and we still hold large stakes in them. But that's all the more reason for politicians to steer clear, however tempting it is to see them as a convenient whipping-boy to further a political career. We have invested too much to see it blown in this way.

The Government went to some lengths to establish UK Financial Investments to administer our stakes in RBS and Lloyds Banking Group at arm's length – but the needless political pressure applied to Barclays makes a mockery of these principles.

Parliament set up an independent regulator, the Financial Services Authority, to keep banks in check – it and its US counterparts have fined Barclays £290m. MPs should let regulators get on with their job and let business do its – create growth and jobs free of political interference, something which might actually help politicians to win an election in future.

Academy fashions jobs for the young

Now some good news. The Fashion Retail Academy, paid for by the likes of Arcadia, Marks & Spencer, Tesco, Next and Experian, has just finished term. It sent students to 105 retailers for work experience and 69pc of them now have full-time work. It shows work experience works and that business is supporting job creation. That's worth celebrating.